Disregarding manufacturer repair procedures on a “case-by-case basis"

Oct. 5, 2017
Before you think this is an insurer-only issue, it must be acknowledged that some repairers are taking a similar approach regarding the procedures as well.

In our collision repair industry a few phrases have been used and abused to the point of almost becoming a standing joke. The most classic is the phrase, “you’re the only one.” It’s been typically used by insurance representatives when negotiating with repairers indicating that they are the only ones charging for any given procedure, typically implying that all other repairers do the operation for free as a cost of doing business or consider it included in something else, even though the estimating p-pages indicate that it is a non-included item. Of course repairers came to realize that in many cases they are NOT the only one charging for it and that the insurer is simply using the phrase in a deceptive way to avoid paying for the operation. In fact, the phrase became such a common point of discussion that some years ago at a major trade event many repairers were wearing buttons that said, “I’m the only one!”

I fear we may have a similar phrase coming into prominence and that it may too be lacking in credibility in its recent use. The phrase is “case-by-case basis.” Many articles have been written about the adherence to Original Equipment Manufacturer (OEM) repair procedures, including their position statements, and there have been many recent panel discussions on the topic at industry events like NACE Automechanika Chicago and CIC. I am sensing that there is an echo chamber effect of insurers stating that they are looking at approving of the procedures, especially pre- and post-repair scans, on a “case-by-case basis.” Of course the approval of the procedure typically includes approval of payment for it. Before you think this is an insurer-only issue, it must be acknowledged that some repairers are taking a similar approach regarding the procedures as well. Many are also commonly using the phrase, “We are still gathering information.” Let’s take a closer look at the issue.

Definition

Some internet sources define the phrase as considering each case individually rather than considering several cases together as a whole or free from external control and constraint; "an independent mind’" "a series of independent judgments;" "fiercely independent individualism." Another said, “Used to describe decisions that are made separately, each according to the facts of the particular situation.”

Application

Of course when using the phrase “case-by-case basis” regarding whether or not to consider the viability of an auto OEM procedure, there is a clear implication of questioning the necessity of the procedure, which can also imply there is a questioning of the motives of the OEM. It can even call into question the integrity of the OEM.

Let’s consider some common examples. One major manufacturer directs our industry to not repair aluminum wheels, but instead to only replace damaged ones with new original equipment (OE) replacement wheels. Another has stated we shouldn’t perform paintless dent repairs. Many OEMs say that we should only use new parts. If anyone in a position of determining repair methodology were to consider questioning these OEM directives on a “case-by-case basis,” how would one do it? Presumably one could look at wheels, perhaps including measurement of how much straightening and welding and machining would be required to consider the structural difference in the wheel. One could look at past history of similar repairs and consider information from professional wheel repairers. There are methods to check for cracks and run out. In terms of PDR work, one could inspect the backside of panels to consider corrosion protection issues and look for exterior paint damage. Alternative parts decisions include consideration of used part condition or certification of aftermarket parts or past experience or perhaps even a fit test. At the very least, a casual inspection of alternative parts allows one to assist in making judgments before installing the part.

You cannot deny that in these common examples use of the OEM procedure offers a dependable and predictable solution, though it may be more costly. Using information as I described, one could also argue that the alternative methods may offer a reasonable repair solution that could offer similar appearance and function as the OEM procedure for less expense. We all know these alternatives are used commonly with presumably good success. We can use our knowledge of the alternative repair methodology, our knowledge of similar situations, and the specific circumstances to make a “case-by-case basis” decision on how to proceed. I am not saying our decision will necessarily be the best one, and may be not even a good one, but if nothing else we have information to base our decision on.

Now let’s approach the case of deviating from an OEM scan procedure. Many OEMs mandate a pre- and post-repair scan for ALL collision repairs. Some give a date range, such as 2004 or newer. Some don’t, implying that all vehicles of their brand should be scanned regardless of age. However, we know that OBDII was mandated in 1996 so our ability to scan those older than that is limited and in practicality we see very few collision repairs on vehicles that old, so let’s consider newer vehicles. (In 2016, according to CCC, 65.8 percent of collision estimates were written on vehicles 6 years old or newer.) So, can we look at an age exception to deviate from the OEM procedure? If so, at what age?  On a 2007 or 2010 or 2013, can you look at it and say with certainty that neither the collision nor the repair process will without doubt NOT cause a diagnostic trouble code (DTC), sometimes referred to as fault codes, to be triggered? Do you have some history or experience or other resource for your judgment to allow you to know that there is no need to scan even though the OEM says you should? How about severity? On a light hit, do you know for certain there will be no DTCs? Many of us in the field are finding circumstances where a simple door trim panel R&I or a bumper R&I will trip fault codes, some indicating a need to re-initiate modules to restart their communication with each other. Some issues from a door trim removal can include sound-system issues, lack of heated steering wheel function, or lack of sun roof function. None of us would have expected such issues in years past. What past experience can we rely on to make exceptions?

There is little or nothing available in terms of tools and logic to determine when to make exceptions. Most experts in the industry continue to promote the idea of pre- and post-repair scans. The only way to look into the advanced technology systems is through a scan tool.

Another example

There is a prominent news story being currently covered in our trade press regarding deviating from OEM repair procedures. A shop in Texas replaced a roof on a Honda Fit using an adhesive instead of welding it as the factory directs. In a significant front-end collision, the roof came loose and the occupants received injuries from a resulting fire. They are suing the shop and separately suing the insurer. The shop claims that the insurer influenced their decision regarding the repair methodology. The plaintiffs’ attorney stated, “The day of reckoning is here — certified body shop facilities better stop listening to the insurance companies they get paid by and start listening to the OEM that spent hundreds of millions of dollars developing, designing, manufacturing and testing vehicles to provide maximum protection in foreseeable accidents. Insurance companies don’t repair vehicles and don’t develop, design, manufacture and test vehicles. As such, they should stay out of the way of those who are charged with protecting our family should an accident happen.”

In reading the transcript of the attorney questioning the shop’s director, I see a litany of direct questions about the person who made the repair methodology decision including, had he worked at American Honda?; had he worked at any vehicle manufacturer?; did he have a degree in mechanical engineering?; did he have a degree in metallurgy?; and did he have a degree in structural analysis? Sitting on a stand and answering such questions about an auto accident with physical injuries that was made worse by a shop’s prior repair work, especially while deviating from OEM procedures, presents a worst possible nightmare for a shop manager or owner. The million-dollar lawsuit is only one consequence. The loss of reputation and the cost of future shop insurance premiums (if you could buy a replacement policy) make the exposure even greater. It can easily be potentially devastating to a business and to the careers of those involved. And of course knowing that your shop’s repairs resulted in additional pain and suffering of the people injured in the accident is a burden to bear as well.

Industry Change

As our industry has experienced significant technology changes in the past it seems that we have been slow to come to conclusions regarding how to deal with them including repair and estimating and pricing procedures. Eventually we tend to figure it out and the procedures become the norm. Examples include base coat/clear coat refinishing, blending, and GM’s switch to unibody vehicle construction.

At a recent CIC meeting, there was a panel discussion on insurer repairer differences of opinion and recommendation, particularly focused on scans and factory repair procedures. George Avery stood up and asked why it is taking so long for our industry to sort this out and implied that we should be able to do so faster. His observation is spot on. The scanning issue has been THE hot topic for about two years now. It’s been a year since many OEMs issued position statements on the matter. As some repairers and insurers state that they are still “gathering information,” are they being sincere or simply avoiding the issue? The OEM position statements and repair procedures are very clear. Anecdotally, those who scan collision vehicles continue to find more and more unforeseen issues, leading them to conclude that there is wisdom in performing pre- and post-repair scans.

Case-by-case basis

How about those who say they address the scan issue on a case-by-case basis? Have they developed criteria to use to make such determinations? In my experience I’ve interacted with many insurance representatives who have been directed to handle payment for scans on a case-by-case basis, yet they have little or no idea what that means. They can’t see into the electronic systems and have little or no way of knowing whether there are diagnostic trouble codes (DTCs) present nor do they know about other potential issues such as modules that need to be initiated to resume communication to key components. In reality, they are guessing. Some are making decisions based on inaccurate information. I hear negative rhetoric about the OEMs including statements such as, “They are just passing liability on to us;” “You can’t trust what they say;” “They are being self serving;” “If they really cared about safety they would provide repair information for free;” “They say we shouldn’t use non-OEM parts, and we know that is not accurate. Why should we trust them on their position statements and repair procedures?” Of course, such rhetoric only increases the friction between OEMs, insurers and repairers. It gets us further from solutions instead of closer. Why would we NOT expect OEMs to protect their potential liabilities? After many years of high-profile recalls, lawsuits and extensive government oversight why would anyone expect something different? The solution for this issue is to come to some generally accepted policy of which repair vehicles to scan and calibrate and come to some generally accepted methodology of compensation. Unless someone can come up with some verifiable proof, based on uncontestable information that provides a safe alternative to the factory repair procedures, particularly regarding scans and calibrations, I don’t see how we can do anything but comply with them.

Imagine that you are a repair facility owner/manager and a repaired vehicle — say a common one like a 2010 Honda or Toyota — was in another accident. It was severe, the airbag restraint system deployed, and there were personal injuries. The vehicle owner and their savvy attorney are suing you for a lot of money, claiming that your repairs were not up to factory standards and therefore the vehicle didn’t perform as the vehicle was designed from the factory, thus increasing loss and injury. You are on a witness stand in front of a judge, jury and cameras. The prosecuting attorney asks you questions and you provide your answers:

Q: Did your shop perform pre- and post-repair scans on the vehicle?

A: No.

Q: Did your shop perform the factory specified calibration on the right front seat sensor?

A: No.

Q: Please explain why not.

A: We perform scans and calibrations on a case-by-case basis. We feel that it is not necessary in some situations.

Q: What does the manufacturer specify?

A: That we perform scans and the seat calibration on this model in any collision repair.

Q: But you don’t feel it’s necessary.

A: No.

Q: What criteria do you use to make that determination?

A: On some jobs the severity of the damage is not as extensive. We don’t scan or calibrate those. We have fixed other similar vehicles without performing the scan and calibration and haven’t had any problems.

Q: What do you mean by ‘haven’t had any problems?’

A: Well, they haven’t come back to us with an issue.

Q: But, you can’t prove that they are working correctly.

A: Well no, I can’t prove it.

Q: Do you know with all certainty that the victim’s vehicle safety systems were functioning properly when it left your shop?

A: Well, I think so. There were no dash lights. The car drove fine.

Q: Do you know that there were no fault codes in the system when the vehicle left your shop?

A: Well, no.

Q: Do you know if the RF seat sensor was in proper calibration when it left your shop?

A: I assume it was.

Q: But you don’t know for certain.

A: No.

Q: What happens in an airbag deployment situation when the RF seat sensor is out of calibration?

A: It can cause the airbag system timing and deployment severity to be different.

Q: Out of factory specs? Deploying differently than it was intended?

A: Well yes, potentially.

Q: Could that have made a difference in the injuries sustained by the occupant?

A: I don’t know.

Q: In your case-by-case basis decision making, where you elected not to scan or to  calibrate the seat sensor, why would you make those choices when you don’t know what the potential outcome is, especially when considering the safety of your customer and their passengers? Why did you think it was ok not to perform the factory prescribed operation?

A: (silence)

Risk management

The above hypothetical situation is a worst possible nightmare for a collision shop owner/manager, similar to the roof repair lawsuit described earlier. Again the results can be devastating to the business and the careers of those involved. This issue of deviating from factory repair procedures, particularly regarding scans and calibrations, is different from other significant industry changes over the years. No one will get injured from a paint process change. Yet a malfunctioning accident avoidance system or airbag restraint system can be lethal. Granted the frequency of catastrophic results may be low. But low percentages of airplanes falling out of the sky are not acceptable. Low percentages of nurses dropping babies are unacceptable. Our collision repair industry should live up to the same high standards where any failures are unacceptable. We owe it to our customers who entrust their safety with us.

It is like running through an open field with an umbrella during a thunderstorm. You may be able to do it many times without being hit by lightening. But that still doesn’t make it a good idea. The odds may catch up with you.

So really, there should be no “case-by-case basis” deviation when it comes to scans and calibrations. Repairers and insurers would be wise to stick to the OEMs’ repair procedures. And frankly the same logic applies to at least most other collision repair procedures as well. The changing technologies and increased sophistication of our newer vehicles, as well as the opportunities for litigation, are increasing the risks of deviation.

Insurance companies are in the business of risk management. Repairers are not. In fact, it is more prudent to be in the business of avoiding risk, for the sake of our customers and our businesses. Until our industry recognizes that and seeks solutions that work to protect the needs and interests of all parties this will be an unsettled issue.

About the Author

Darrell Amberson | Director, MSO relations

Darrell Amberson is the president of operations for LaMettry's Collision, a 10-location multi-shop operator in the Minneapolis area. Amberson has more than 40 years of collision industry experience, and served as chairman of the Collision Industry Conference for the 2021-2022 term as well as interim chairman for the first two CIC meetings of 2024.

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